Which institution was created at Bretton Woods specifically to provide short-term loans to countries struggling with balance-of-payments deficits?
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Correct answer: The International Monetary Fund (IMF)
The IMF was designed to oversee the exchange rate system and provide temporary financial assistance. This helped countries maintain their fixed exchange rates without resorting to destructive trade barriers.
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More Bretton Woods System questions
- The International Bank for Reconstruction and Development (IBRD), now part of the World Bank, was initially established to:
- What was the 'gold-exchange standard' established by the Bretton Woods agreement?
- Which prominent economist represented the United Kingdom at Bretton Woods and proposed a global currency called the 'Bancor'?
- The 'Nixon Shock' of 1971 effectively ended the Bretton Woods System by:
- Why did the Bretton Woods System face a 'liquidity problem' in the 1960s known as the Triffin Dilemma?
- The Bretton Woods System was designed to avoid the 'beggar-thy-neighbor' policies of the 1930s, which included: